Posts from Wednesday May 9 2012

Presenting…. the totally exciting Euromoney FX survey 2012

So here they are! The results of 2012′s Euromoney survey — based on non-gamed voting by, er, clients!

And… drum roll please… it’s… Deutsche at the global top! Read more

The Closer

ROUND-UP

The S&P 500 bounced back after briefly hitting a two-month low. The index closed down 0.67 per cent at 1,354.58 (Reuters). The Dow Jones Industrial Average is now on a six-day losing streak, closing down 0.8 per cent at 12835.06 (Wall Street Journal). Treasuries in Wednesday’s 10-year auction were sold at a record low yield of 1.855 per cent (Bloomberg). Read more

Bankia, en route to partial nationalisation

The Bank of Spain confirmed late on Wednesday that Bankia’s parent company has asked for a state loan to be converted into shares:

Statement on BFA-Bankia Read more

And the latest US bank holding companies are…

… a Chinese sovereign wealth fund, its bank-investing subsidiary, and China’s largest bank by assets (which is ICBC).

Click image for the full Fed approval doc: Read more

Oh, Greek moratoria (redux)

EFSF will make €5.2bn payment to Greece – Reuters

Although €4.2bn will be disbursed on 10 May and the rest has been held back because Greece doesn’t need it until June, apparently. Anyway, on that note… Read more

Food prices and a protectionism multiplier

Or: an important anti-anti-globalisation argument. The crux of that argument being that there has been a “food crisis”, or two, over the past decade and a significant portion of price hikes can be laid at the door of protectionist policies, which are subject to a damaging multiplier effect.

Essentially, if you see a food shock driving up prices in world markets and increase your own export restrictions to keep food at home, you are feeding into a multiplier process which will end up hurting everyone. Read more

The euro: tap dancing on a Swiss floor

The euro is flirting with the Swiss National Bank’s floor at pixel time…

 Read more

Positively Fannie

Total comprehensive income of $3.1bn (net income $2.7bn) vs dividend payments to Treasury of $2.8bn in 2012′s first quarter. Meaning – Fannie Mae hasn’t had to draw from the Treasury to pay back the Treasury for the first time… in a while.

Think sustainable, end quarterly reporting

Back in February, Generation Investment Management LLP, a firm co-founded by Al Gore and David Blood in 2004, issued a report entitled “Sustainable Capitalism”. It came with various actionable suggestions for how such a form of capitalism could be achieved, inclusive of this idea (emphasis ours):

3. END THE DEFAULT PRACTICE OF ISSUING QUARTERLY EARNINGS GUIDANCE Read more

China’s post-stimulus metals demand growth could actually be flat

Here’s a bearish take on what the post-stimulus, rebalancing Chinese economy will mean for demand of steel, copper and aluminium:

Adjusting to a new paradigm: We see a no/low growth scenario off what is now a very high base level of demand as a realistic rather than a disaster scenario Read more

Bankia in the coalmine, looking like a dodo

The Spanish government may be bailing out Bankia by injecting cash in return for contingent convertibles to the tune of some €7-10bn, but many analysts have reacted with something along the lines of: “Haha! That’s cute! They are like ever so slightly less delusional about the trouble their banking sector is in! Adorable!”

Bankia is no canary in a coalmine. It’s more like the first sign that the inevitable support of the banking sector is finally materialising. Indeed, prime minister Mariano Rajoy was quoted saying: ”If it was necessary to reactivate credit, to save the Spanish financial system, I wouldn’t rule out injecting public funds, like all European countries have done,” in an interview with radio station Onda Cero, as reported by the WSJ. Finally playing catch up, are we? Read more

Markets Live transcript 9 May 2012

Live markets commentary from FT.com 

The (early) Lunch Wrap

Good morning, New York…

FT ALPHAVILLE Read more

A tipping point in eurozone crisis talk

ECB executive board member Jörg Asmussen in the Handelsblatt (Google translation):

“Greece must be clear that it agreed to this rehabilitation program is no alternative, if it wants to remain a member of the Euro-zone,” Read more

Further reading

Elsewhere on Wednesday,

- Spain stays in ‘denial’ about its banks, with ‘recognition’ still over the horizon somewhere. Read more

The 6am Cut London

Greece is heading for a clash with international lenders as the leftwing party Syriza called for the ripping up of a “barbarous” austerity programme underpinning its bailout and questions mounted about the country’s future inside the euro, says the FT. Syriza’s attempts to form a coalition government are likely to be rejected by the two biggest mainstream parties, which will probably lead to a new election in June. Meanwhile Jörg Asmussen, an ECB executive board member, for the first time raised the possibility of a Greek exit from the euro in an interview with Handelsblatt.

Walt Disney’s quarterly earnings beat Wall Street expectations as profit rose 21% despite a loss from the science fiction film bomb John Carter, reports Reuters. The strong performance of The Avengers underscores growth in the company’s superheroes franchises, says the FTRead more

Overnight markets: Down

Shares, gold and oil fell and the euro remained pressured on Wednesday as Greece struggled to form a government two days after an election, heightening the risk that a bailout deal could be scrapped, says Reuters.

The MSCI Asia Pacific Index declined 1.4%at 1:04pm in Tokyo, poised for its lowest close since January 19, says Bloomberg. The Nikkei 225 Stock Average lost 1.7%; S&P 500 futures weakened 0.4%. The kiwi fell 0.4% against the dollar in its longest losing streak since March 2001 while the Australian dollar sank 0.6%. Read more